Worldwide Transportation & Strategic Sourcing Analysis

Under pressure from competitors and investors, the client asked LVP Consulting to consolidate their transportation needs within a decentralized structure and optimize more than $250 million in spending across five transportation modes.

The LVP team collected and examined the client’s shipment data, service needs, and potential cost reductions across more than 270 shipping sites.

• Held interviews with cross-functional teams and facility managers, gathering detailed data to benchmark costs and procedures.
• Spotted opportunities to collaborate with suppliers for overall cost savings.
• Determined the necessity for skill-based training and the creation of a project plan and timeline to build the sourcing organization.

To deliver total cost savings, LVP Consulting launched a global Strategic Sourcing initiative focused on the client’s $250+ million transportation spend across Air, Ocean LCL, Ocean FCL, International Parcel, Truckload, and Less-than-Truckload.

• Collected data on over 800,000 shipments covering about 55,000 active shipping lanes.
• Surveyed more than 1,000 global shipping providers across all transportation modes.
• Created an online quoting platform to issue a multi-mode, multi-region RFQ to the market.
• Identified and thoroughly developed category-specific negotiable topics.

Cost reductions were achieved by streamlining the client’s supply base and greatly enhancing alliance management.

• Generated $37.3 million in annual savings for the quoted lanes.
• Identified an additional $20.3 million in savings on the remaining 49% of global spend.
• Improved free cash flow by $1.2 million annually through optimized payment terms.
• Cut the supply base by more than 90%.
• Established a geographic selection process for ongoing management of acquisitions and divestitures.
• Created a future pricing model to forecast costs for new shipping lanes.